Pawn shops give you immediate cash, either through no-credit-check, collateral loans, or by purchasing your items. Therefore, if you need quick cash and have items you will not need immediately, you may choose between pawning vs selling those items to a pawnbroker. Select and clean your item carefully. After you have chosen a reputable pawn shop, research the item’s value and pawnshop regulations. Finally, learn about the loan terms.
Whether you choose to pawn or sell, your item choice is key to gaining the greatest return. For example, pawn shops will purchase or loan money on gold, precious metals and stones, such as those found in jewelry. They will pay for tools and weapons, such as guns. Electronics, antiques and musical instruments and equipment are commonly pawned items. Some pawn shops will pay for designer clothing and accessories, while others will pay for vehicles.
As you choose your items, look for brand names and metals stamped with their metal content, such as 18K gold.
Your item should look its best. Therefore, it should be clean and polished. In addition, brand names or stamping should be protected during cleaning and highlighted during the transaction.
As the seller, you are responsible for getting the greatest sales price. Therefore, you should research your item to determine its value and be willing to negotiate. Pawnbrokers will give you the lowest price they can, and if you do not do your research, you may receive significantly less than the item is worth. However, you still may only receive 30-60% of the actual value of your item.
Pawn Shop Regulations
Pawn shops are regulated by the state, and most must wait 90 days after you default on your loan to resell your pawned items. However, if the pawnbroker earns more on the sale than you owe, you should expect a return of the amount the pawnbroker earned greater than what you owe. If you are notified of a surplus, you typically must return to the pawn shop within a specified period of time to claim it.
Pawn shops are restricted from loaning money to anyone under 18 years of age and cannot charge for insurance in case of lost or stolen items. Borrowers should investigate their rights prior to pawning any item.
Pawn shops cannot purchase stolen items or any item whose serial or identification numbers has been adjusted. They cannot provide loans above a value estimated by the state, such as $2,000.
Prior to pawning an item, ask the pawnbroker about the company’s monthly interest rate, insurance and where your item will be stored. Find out what documentation they need from you and if you will receive payment reminders via mail or other sources. Finally, if you find that the pawn shop is untrustworthy or the transaction is not what you expect, walk away.
Pawn shops offer valuable services if you need quick cash or wish to purchase something at below market value. Carefully choose and clean the items you wish to sell or pawn. Research your items’ values and pawning regulations in your state. Finally, ask questions about the loan process and terms.